Institutional Research

Swiss watch exports reached CHF1.8bn in August, with trailing-12-month exports turning positive for the first time in two years. Goldman Sachs sees continued regional volatility but maintains a positive view on Watches of Switzerland Group, citing its US exposure, hard-luxury focus and certified pre-owned opportunity.

• August Swiss watch exports increased 9.1% year-on-year to CHF1.8bn.
• Year-to-date exports rose 1.7%, while trailing-12-month exports turned positive for the first time in two years.
• Mainland China exports rose 16% in August, while US exports fell 19% amid tariff-related shipment volatility.
• Goldman Sachs cites the US market, resilient hard luxury and Rolex CPO as favorable factors for Watches of Switzerland.

Citi expects concerns over EV battery demand and weaker CATL output to weigh on near-term lithium sentiment. A 923-ton weekly inventory draw could, if sustained, lead to physical-market tightening in October.

• Battery and battery-material output is expected to rise only by mid-single digits month on month in September 2026, excluding lithium.
• Lithium output may increase by about 11% month on month in September.
• ZE Consulting estimates CATL monthly output will decline 3% month on month in September and be broadly flat in October.
• Lithium inventory fell by 923 tons during the week.
• Continued inventory declines could tighten the physical lithium market in October.

Citi expects USD/JPY could reach about ¥159/$ over the next few weeks and forecasts ¥156/$ for December. Longer term, it sees past JPY-buying intervention and rising Japanese yields helping drive the pair below ¥150/$ in the second half of 2027.

• USD/JPY could rise to around ¥159/$ in the short term, near its 100-day and 200-day moving averages.
• Citi's base case is approximately ¥156/$ in December and below ¥150/$ in the second half of 2027.
• Japan has bought more than ¥27 trillion of JPY since April, leaving the market more vulnerable to JPY-positive shifts.
• Rising JPY rates and cheap JGB valuations are becoming a source of upward pressure on the yen.
• A temporary correction of 10% or more in Japanese equities could expose USD/JPY to sharper downside.

The report argues that oral SERDs can expand beyond metastatic breast cancer into the much larger adjuvant setting. Goldman Sachs is especially optimistic on Lilly’s EMBER-4 opportunity, while highlighting important upcoming Roche and AstraZeneca trial and regulatory catalysts.

• Goldman Sachs models roughly $27bn of global peak sales for oral SERDs in adjuvant HR+/HER2-negative breast cancer.
• Lilly’s imlunestrant is modeled at $6.4bn unadjusted and $4.4bn risk-adjusted adjuvant peak sales, versus roughly $2.0bn Visible Alpha consensus for the overall franchise.
• Roche’s giredestrant has first-mover potential, but the report expects early uptake to be gradual despite a $15.2bn non-risk-adjusted peak-sales forecast including low-risk patients.
• AstraZeneca’s CAMBRIA-1 and Lilly’s EMBER-4 are key 2027 switch-adjuvant readouts.

The weighted MSASI rose 4ppt to 23%, but remained weak, while its one-month average fell to 29%. Morgan Stanley maintains its early-September China index target cuts, citing a more hawkish Fed, softer macro data and normalized investor positioning.

• Weighted MSASI increased 4ppt to 23% as of September 16, while the weighted one-month average declined 2ppt to 29%.
• China’s August data showed export-led industrial resilience but weak consumption, investment and property activity.
• Morgan Stanley’s June 2027 targets imply only 5-7% upside across major China indices.
• Southbound net inflows were US$2.1bn during September 10-16, while year-to-date inflows of US$52bn were 38% of the comparable prior-year level.

Morgan Stanley's China BEST Conference feedback highlights Kingboard Laminates' expectation that fiberglass-cloth shortages will persist through 2027, supporting price increases. The report retains an Overweight rating and HK$75.00 target price.

• Fiberglass-cloth capacity growth is constrained by equipment supply, with shortages expected through 2027.
• Kingboard plans to add 450-500 Toyota looms in 2026 and 1,100 more in 2027.
• Specialty glass-cloth and HVLP copper-foil products are advancing customer qualifications.
• Morgan Stanley lists HK$75.00 target price versus HK$46.62 closing price on September 17, 2026.

Bernstein sees Chinese BEV entrants, autonomous freight and continued electrification spending as long-term threats to incumbent truckmakers’ pricing power and margins. It rates Daimler Truck Underperform and Volvo and Traton Market-Perform.

• Chinese truckmakers showed credible products, maintenance and financing capabilities, raising the risk of difficult pricing conditions in less-specialised highway segments.
• Autonomous trucking could lower US truck total cost of ownership by about 28% before software fees, potentially accelerating freight-carrier consolidation.
• Battery cost declines alone are unlikely to achieve BEV truck TCO parity; charging, subsidies and operating conditions remain decisive.
• Sector R&D, capex and JV/associate cash investment exceeded €7bn in 2024 and is expected to remain elevated.

Morgan Stanley reiterates Overweight on Zhejiang Huayou Cobalt, citing sulfur self-sufficiency initiatives, Indonesian nickel expansion and Zimbabwe lithium growth. Its Rmb75.00 target price implies 113% upside from Rmb35.18.

• Gypsum-based acid production could meet about 30% of Huayue and Huafei sulfur needs after ramp-up.
• The Huaxin OSEBF project targets about 40kt of nickel output next year.
• Zimbabwe lithium shipments are targeted at 100-120kt LCE in 2027.
• Local lithium conversion in Zimbabwe could reduce cost by more than Rmb10k/t LCE versus exporting concentrate.

Goldman Sachs lowers sector forecasts as weak on-trade demand, weather disruption and channel shifts pressure volumes. It raises Budweiser APAC's M&A rank to 2, keeps Buy on Bud APAC and CR Beer, and downgrades Tsingtao H shares to Neutral.

• 2026E industry volume and ASP growth are forecast at -3.5% and +1.0%, respectively.
• Premium beer is expected to be the only growing volume segment in 2026E.
• Budweiser APAC's M&A rank rises from 3 to 2, implying a medium 15%-30% acquisition probability under Goldman Sachs' framework.
• Tsingtao H is downgraded to Neutral with its target price cut to HK$43.0 from HK$54.0.
• China beer valuations of 4.3x-5.4x NTM EV/EBITDA excluding Tsingtao A stand at a 30%-40% discount to global peers.

JPMorgan retains Overweight and a Dec-2027 target price of W2.4mn, arguing that direct-customer MLCC price increases and tighter AI-server ABF supply-demand can substantially lift earnings through FY28E.

• FY27E-FY28E operating-profit estimates rise 24-29%.
• JPMorgan expects direct-customer MLCC ASP hikes from 4Q26E, with potential further increases in 2027E.
• The report estimates MLCC prices could rise 140% over two years, versus 80% in the 2017-19 cycle.
• Component Solutions operating margin is projected at 31% next year and 38% in FY28E.
• The W2.4mn target is based on 27x FY28E EPS, a 30% premium to the prior-cycle peak multiple.